Purdue Executive Committee approves tuition plan, operating budget

May 27, 2011

WEST LAFAYETTE, Ind. – The Executive Committee of the Purdue University Board of Trustees on Friday (May 27) approved tuition and fee rates for the next two academic years and a conceptual general fund operating budget for the current fiscal year.

The new rates represent a base increase of 3.5 percent, which fell within guidelines issued by the Indiana Commission for Higher Education (ICHE). The approved rates also include a new fitness and wellness fee that will be phased in over three years, beginning with a $91 fee for the 2011-12 academic year.

"The trustees appreciate all of the people who took the time to speak today or provide written comments, and we did hear you," trustees chairman Keith Krach said. "The board members were convinced that this tuition and fee proposal was as low as we could go and maintain the quality of a Purdue degree."

Purdue President France A. Córdova said in a written statement: "Purdue continues to offer an education that is respected around the world, but remains affordable for Indiana students. We will continue to critically review our budget and focus on ways to strategically target spending and grow revenue sources beyond state appropriations and tuition."

"Increasing college completion rates in Indiana depends on our ability to control college costs. Purdue's decision to set tuition rates within the commission's targets recognizes the need to balance the needs of the campuses with the needs of their students."

At the West Lafayette campus in the 2011-12 academic year, resident students enrolled before summer 2009 will pay an additional $388, and those enrolled after that date will pay an additional $408. Nonresident students enrolled prior to summer 2009 would see an increase of $1,004 while those initially enrolled in summer 2009 or after would see an increase of $1,024.

The fitness and wellness fee, previously endorsed by Purdue Student Government and approved by state legislators as a condition for moving forward with renovations and ongoing improvements to the university's Student Fitness and Wellness Center, was acknowledged as an appropriate special circumstance by ICHE.

Purdue's tuition and fees currently rank ninth among Big Ten universities for resident undergraduates and seventh for nonresident students.

Fees for students at Purdue Calumet, Purdue North Central and Indiana University-Purdue University Fort Wayne are assessed on a per credit hour basis. The rates approved by trustees reflect a 2.5 percent increase for resident and nonresident students and are within ICHE guidelines.

The approved conceptual general fund budget - $1.16 billion system-wide for the upcoming fiscal year - was drafted after the state approved its biennial spending plan.

Purdue received a cut of 3 percent in its operating appropriations, or $7.3 million at the West Lafayette campus. The new appropriation of $233.8 million is 10.8 percent below the highest level of $262 million in fiscal year 2009 and is close to the fiscal year 2004 level of $233 million.

Purdue's spending plans will allow the university to continue funding initiatives outlined in the strategic plans of each campus while also providing the funding needed to offset increased operational costs, said Al Diaz, Purdue's executive vice president for business and finance, treasurer.

Staff benefits and unavoidable costs, such as fuel, utilities, insurance, plant expansion, and repair and rehabilitation, are expected to increase a total of $6.4 million on the West Lafayette campus in the upcoming fiscal year. The plan also calls for a 1.5 percent merit salary increase at West Lafayette that will cost nearly $8.6 million. The merit salary increase policy also gives units the option to supplement up to 0.5 percent from their own funding sources.

At West Lafayette, the proposed budget plan includes a 3 percent decrease in operating appropriations and incorporates elements from the university's Sustaining New Synergies cost-savings initiative, including budget reductions to the units, health-care cost reductions, energy savings, early retirement incentive program savings, revenue increases, and flat supply and expense budgets. Funding for more than 40 percent of fiscal year 2012 expenditures will be made with internal budget reallocations, which allowed Purdue to keep tuition increases within state recommendations.

In approving Purdue's general fund budget, which supports educational and base operating expenditures, the trustees endorsed the following spending plans for fiscal year 2012:

* At the West Lafayette campus: A 2.9 percent increase to $933.8 million.

The general fund, which supports the academic mission of the university, represents only a portion of the university's total system-wide operating budget. The full operating budget totals more than $2.17 billion for fiscal year 2011 and includes the general fund; sponsored programs; gifts; and revenue from residence halls, athletics, other auxiliary income and university-funded financial aid.

The total operating budget fiscal year 2012 is not yet established and will be presented at the trustees' September meeting.